THIS IS NOT INVESTMENT ADVICE. IT IS A PERSONAL REFLECTION ON INVESTING. RELY ON NOTHING STATED HEREIN.
Today, RBS-I, the "might-pay" trust preferred I purchased exceeded its 8% loss limit and was sold. I still like the play, but rules are rules.
Washington's failure to address fiscal concerns (e.g. too much spending, no guidance on taxes) has placed undue emphasis on monetary policy (Fed) to prop up the economy. Last week's announcement of possible QE2 intervention has resulted, predictably, in further weakening of the dollar. Accordingly, today I opened a position in UDN, an ETF tracking the dollar short index. Does anyone have a better "falling dollar" currency hedge? As a non currency hedge, I intend to add to commodity and energy positions. This week I bought a decent amount of BP (in addition to the BP options), opened a position in ENI (E) and will add to RDS/A on a dip. All three are energy plays with the added comfort of pound/euro vs. dollar hedging.
The Jan 11 BP options went up again. My gain so far is 64% and 68% respectively. Our subscriber is up 280% since Monday. The March 2011 $5 Citigroup option started to move today, going from $0.11 to $0.13 a 17% gain. I got in at $0.12 a 8% gain. If the government disposes of all of its C common by the end of February, there should be a good upward movement---hopefully all the way to $5 and beyond.
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